Publication:
Rising Income Inequality in China : A Race to the Top

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dc.contributor.authorLuo, Xubei
dc.contributor.authorZhu, Nong
dc.date.accessioned2012-05-31T19:53:10Z
dc.date.available2012-05-31T19:53:10Z
dc.date.issued2008-08
dc.description.abstractIncome inequality in China has risen rapidly in the past decades across regions, between rural and urban sectors, and within provinces. The dynamics of divergence across these sub-national areas have taken the form of a "race to the top" - meaning that all segments of the population, including the poor with low education in lagging inland rural areas, have experienced gains in average income. The largest gains have been registered by those with higher income and education in leading coastal urban areas. Using the China Economic, Population, Nutrition and Health Survey data of 1989 and 2004, we show that the most important factors explaining overall inequality are differential returns to schooling and sector of employment. A decomposition analysis based on household income determination shows that the increase in returns to education explains two-thirds of income changes in urban areas and one-sixth in rural areas. The widening income gaps are the consequence of higher growth in leading urban and coastal areas and that the skilled population has benefited more from the economic reforms carried out during the last 25 years. The authors argue that rising income inequality can be part of a normal process of development at a certain stage, and that the dynamics of spatial income divergence in the form of "a race to the top" can be desirable to some extent as it unleashes competitive pressure and creates incentives for investment in skills. Continuing to improve market efficiency and investing in people, in particular improving education service in lagging areas to poor people, are important for sustainable growth and equitable distribution in the long run.en
dc.identifierhttp://documents.worldbank.org/curated/en/2008/08/9794547/rising-income-inequality-china-race-top
dc.identifier.doi10.1596/1813-9450-4700
dc.identifier.urihttps://hdl.handle.net/10986/6789
dc.languageEnglish
dc.publisherWorld Bank, Washington, DC
dc.relation.ispartofseriesPolicy Research Working Paper No. 4700
dc.rightsCC BY 3.0 IGO
dc.rights.holderWorld Bank
dc.rights.urihttp://creativecommons.org/licenses/by/3.0/igo/
dc.subjectABSOLUTE POVERTY
dc.subjectABSOLUTE VALUE
dc.subjectACCESS TO EDUCATION
dc.subjectACCOUNTING
dc.subjectAGGREGATE INCOME
dc.subjectALLOCATION OF RESOURCES
dc.subjectANNUAL INCOME
dc.subjectAVERAGE ANNUAL
dc.subjectAVERAGE GROWTH
dc.subjectAVERAGE GROWTH RATE
dc.subjectAVERAGE INCOME
dc.subjectBALANCED GROWTH
dc.subjectBASIC EDUCATION
dc.subjectCOMPARATIVE ADVANTAGE
dc.subjectCONSUMER
dc.subjectCONSUMER PRICE INDEX
dc.subjectCONTRIBUTION
dc.subjectCONTRIBUTIONS
dc.subjectCOUNTRY REGRESSIONS
dc.subjectDECOMPOSITION ANALYSIS
dc.subjectDEMOGRAPHIC PRESSURE
dc.subjectDENSITY CURVE
dc.subjectDEPENDANT
dc.subjectDEVELOPING WORLD
dc.subjectDEVELOPMENT ECONOMICS
dc.subjectDEVELOPMENT EFFORTS
dc.subjectDEVELOPMENT REPORT
dc.subjectDISPARITY IN INCOME
dc.subjectDISTRIBUTIONAL CHANGES
dc.subjectDISTRIBUTIONAL EFFECT
dc.subjectDISTRIBUTIONAL EFFECTS
dc.subjectDIVERSIFICATION
dc.subjectECONOMIC DEVELOPMENT
dc.subjectECONOMIC EFFICIENCY
dc.subjectECONOMIC GROWTH
dc.subjectECONOMIC LITERATURE
dc.subjectECONOMIC MANAGEMENT
dc.subjectECONOMIC PROGRESS
dc.subjectECONOMIC REFORM
dc.subjectECONOMIC REFORMS
dc.subjectECONOMIC REVIEW
dc.subjectECONOMIC STUDIES
dc.subjectECONOMIC TRANSITION
dc.subjectECONOMICS LETTERS
dc.subjectEDUCATED PEOPLE
dc.subjectEDUCATION LEVEL
dc.subjectEMPIRICAL EVIDENCE
dc.subjectEMPIRICAL FINDINGS
dc.subjectEQUALITY OF OPPORTUNITY
dc.subjectEQUITABLE DISTRIBUTION
dc.subjectFARM ACTIVITIES
dc.subjectFARM ACTIVITY
dc.subjectFARMERS
dc.subjectFINANCIAL CONSTRAINTS
dc.subjectFISCAL CONSTRAINTS
dc.subjectFIXED EFFECTS
dc.subjectFOOD POLICY
dc.subjectFOOD SAFETY
dc.subjectFORMAL EDUCATION
dc.subjectFULL EMPLOYMENT
dc.subjectGINI COEFFICIENT
dc.subjectGINI INDEX
dc.subjectGOVERNMENT POLICIES
dc.subjectGRAIN PRODUCTION
dc.subjectGROWTH EFFECT
dc.subjectGROWTH ELASTICITY
dc.subjectGROWTH PERFORMANCE
dc.subjectHEALTH CARE
dc.subjectHOUSEHOLD DATA
dc.subjectHOUSEHOLD INCOME
dc.subjectHOUSEHOLD INCOMES
dc.subjectHOUSEHOLD LEVEL
dc.subjectHOUSEHOLD MEMBERS
dc.subjectHOUSEHOLD PER CAPITA INCOME
dc.subjectHOUSEHOLD SURVEY
dc.subjectHUMAN CAPITAL
dc.subjectHUMAN CAPITAL INVESTMENT
dc.subjectIMPACT OF EDUCATION
dc.subjectINCOME
dc.subjectINCOME CHANGE
dc.subjectINCOME DIFFERENTIALS
dc.subjectINCOME DISPARITY
dc.subjectINCOME DISTRIBUTION
dc.subjectINCOME DISTRIBUTIONS
dc.subjectINCOME EQUATION
dc.subjectINCOME GAINS
dc.subjectINCOME GAP
dc.subjectINCOME GROWTH
dc.subjectINCOME GROWTH RATE
dc.subjectINCOME INCREASE
dc.subjectINCOME INEQUALITY
dc.subjectINCOME LEVEL
dc.subjectINCOME LEVELS
dc.subjectINCOME POVERTY
dc.subjectINCOME SUPPORT
dc.subjectINCOMES
dc.subjectINCREASE IN INCOME
dc.subjectINDEPENDENT VARIABLES
dc.subjectINEQUALITY FALLS
dc.subjectINEQUALITY MEASURES
dc.subjectINEQUALITY TRENDS
dc.subjectINTERNAL MIGRATION
dc.subjectINTERNATIONAL FOOD POLICY RESEARCH INSTITUTE
dc.subjectINTERNATIONAL PRICE
dc.subjectINTERNATIONAL PRICES
dc.subjectINVESTING
dc.subjectLABOR FORCE
dc.subjectLABOR MARKET
dc.subjectLABOR MARKETS
dc.subjectLAND REFORM
dc.subjectLEVEL OF EDUCATION
dc.subjectLIVING STANDARDS
dc.subjectLOCAL GOVERNMENTS
dc.subjectLOG-NORMAL DISTRIBUTION
dc.subjectLOGARITHMIC SCALE
dc.subjectLONG RUN
dc.subjectLOWER INCOME
dc.subjectMARGINAL RETURNS
dc.subjectMARKET ECONOMY
dc.subjectMEAN GROWTH
dc.subjectMEAN INCOME
dc.subjectMEAN INCOME GROWTH
dc.subjectMEAN VALUE
dc.subjectMEDIAN INCOME
dc.subjectMIDWIFE
dc.subjectMIGRATION
dc.subjectMODERNIZATION
dc.subjectNATIONAL LEVEL
dc.subjectNON-INCOME DIMENSIONS
dc.subjectNURSE
dc.subjectNUTRITION
dc.subjectOPEN ECONOMIES
dc.subjectOWNERSHIPS
dc.subjectPER CAPITA GROWTH
dc.subjectPER CAPITA GROWTH RATE
dc.subjectPOLICY IMPLICATIONS
dc.subjectPOLICY RESEARCH
dc.subjectPOLICY RESEARCH WORKING PAPER
dc.subjectPOLITICAL ECONOMY
dc.subjectPOOR
dc.subjectPOOR GROWTH
dc.subjectPOOR HOUSEHOLDS
dc.subjectPOOR PEOPLE
dc.subjectPOPULATION CENTER
dc.subjectPOVERTY ASSESSMENT
dc.subjectPOVERTY DATA
dc.subjectPOVERTY HEADCOUNT
dc.subjectPOVERTY INCIDENCE
dc.subjectPOVERTY INDEX
dc.subjectPOVERTY LINE
dc.subjectPOVERTY LINES
dc.subjectPOVERTY MEASURES
dc.subjectPOVERTY REDUCTION
dc.subjectPOVERTY-GROWTH-INEQUALITY TRIANGLE
dc.subjectPOWER PARITY
dc.subjectPRO-POOR
dc.subjectPRO-POOR GROWTH
dc.subjectPRODUCTIVITY
dc.subjectPROGRESS
dc.subjectPROPERTY RIGHTS
dc.subjectPROPORTIONAL CHANGE
dc.subjectPROSPERITY
dc.subjectPUBLIC ENTERPRISES
dc.subjectPUBLIC INVESTMENTS
dc.subjectREAL INCOME
dc.subjectREDUCING POVERTY
dc.subjectREGIONAL DISPARITIES
dc.subjectREGIONAL INEQUALITIES
dc.subjectREGIONAL INEQUALITY
dc.subjectREGIONAL POLICY
dc.subjectREGRESSION RESULTS
dc.subjectRELATIVE IMPORTANCE
dc.subjectRELATIVE INCOME
dc.subjectRELATIVE INCOMES
dc.subjectREMITTANCE
dc.subjectRESOURCE CONSTRAINTS
dc.subjectRESPONSIBILITIES
dc.subjectRETIRED
dc.subjectRETIREMENT
dc.subjectRETIREMENT AGE
dc.subjectRETIREMENT PENSION
dc.subjectRISING INCOME INEQUALITY
dc.subjectRISING INEQUALITY
dc.subjectRURAL
dc.subjectRURAL AREA
dc.subjectRURAL AREAS
dc.subjectRURAL HOUSEHOLD
dc.subjectRURAL HOUSEHOLD INCOME
dc.subjectRURAL HOUSEHOLDS
dc.subjectRURAL INCOME
dc.subjectRURAL INEQUALITY
dc.subjectRURAL LABOR
dc.subjectRURAL POVERTY
dc.subjectRURAL POVERTY RATE
dc.subjectSEGMENTS OF SOCIETY
dc.subjectSENIOR
dc.subjectSIGNIFICANT IMPACT
dc.subjectSKILL LEVEL
dc.subjectSKILLED LABOR
dc.subjectSKILLED WORKER
dc.subjectSTOCKS
dc.subjectSUSTAINABLE GROWTH
dc.subjectTYPE OF WORK
dc.subjectUNEMPLOYED
dc.subjectUNEMPLOYMENT
dc.subjectUNEQUAL DISTRIBUTION
dc.subjectURBAN AREAS
dc.subjectURBAN CENTERS
dc.subjectURBAN POPULATION
dc.subjectURBAN POVERTY
dc.subjectURBAN UNEMPLOYMENT
dc.subjectURBAN WORKERS
dc.subjectURBANIZATION
dc.subjectWAGE
dc.subjectWAGE DIFFERENTIALS
dc.subjectWAGE GROWTH
dc.subjectWAGE LEVEL
dc.subjectWAGES
dc.subjectWHITE-COLLAR WORKERS
dc.titleRising Income Inequality in China : A Race to the Topen
dspace.entity.typePublication
okr.crossref.titleRising Income Inequality In China: A Race To The Top
okr.date.doiregistration2025-04-10T12:25:46.091263Z
okr.doctypePublications & Research::Policy Research Working Paper
okr.doctypePublications & Research
okr.docurlhttp://documents.worldbank.org/curated/en/2008/08/9794547/rising-income-inequality-china-race-top
okr.globalpracticePoverty
okr.globalpracticeHealth, Nutrition, and Population
okr.guid889491468240876718
okr.identifier.doi10.1596/1813-9450-4700
okr.identifier.externaldocumentum000158349_20080825160141
okr.identifier.internaldocumentum9794547
okr.identifier.reportWPS4700
okr.language.supporteden
okr.pdfurlhttp://www-wds.worldbank.org/external/default/WDSContentServer/WDSP/IB/2008/08/25/000158349_20080825160141/Rendered/PDF/WPS4700.pdfen
okr.region.administrativeEast Asia and Pacific
okr.region.countryChina
okr.topicPoverty Reduction::Achieving Shared Growth
okr.topicHealth, Nutrition and Population::Population Policies
okr.topicPoverty Reduction::Rural Poverty Reduction
okr.topicPoverty Reduction::Inequality
okr.unitDevelopment Research Group (DECRG)
okr.volume1 of 1
relation.isSeriesOfPublication26e071dc-b0bf-409c-b982-df2970295c87
relation.isSeriesOfPublication.latestForDiscovery26e071dc-b0bf-409c-b982-df2970295c87
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